QuestionQuestion

1. What was Sam Walton's original strategic vision for Wal-Mart? How did this enable the company to gain a competitive advantage?

2. How did Wal-Mart continue to strengthen its competitive advantage over time? What does this teach you about the source of a long-term competitive advantage?

3. By the early 1990s, Wal-Mart was encountering limits to growth in the US. How did it overcome these limits to growth? Explain how the expansion moves that Wal-Mart made in the 1990s made economic sense and helped to create value for the company's shareholders.

4. Wal-Mart is once again encountering limits to growth. Why do you think this is the case? What might Wal-Mart do to push back these limits?

5. How much of Wal-Mart's strategy do you think was planned at the outset, and how much evolved over time in response to circumstances? What does this suggest to you about the nature of strategy development?

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1. Wal-Mart was originally ‘market-positioned’ to serve the needs of customers living in rural areas (suburbs with an average population of about 25,000) where one Wal-Mart store will be serving a total of 100,000 customers from a combined 4-5 suburbs. The decision by Sam Walton to serve target markets that were not the priorities of other giants in the retail industry enabled Wal-Mart to develop a client base. Hence, when competing retailers like K-Mart, Target, and Costco shifted their focus to these customers, Wal-Mart already gained the customers’ loyalty....

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